UK Government to subsidise carbon dioxide production for a further three months

A new agreement has been reached between the UK Government and US carbon dioxide manufacturer and distributor CF Industries, following the end of three-months of subsidies on 31 January 2022.

The new deal will last another three months and will not come at an extra cost to the taxpayer, according to the Department for Business, Energy & Industrial Strategy (BEIS).

The additional support will allow the CF Industrial fertiliser plant in Billingham to remain open and continue supplying food and drinks processing companies with the necessary carbon dioxide.

In September 2021, a rise in gas prices forced CF Industries to close two of their sites, one in Teeside and the other in Cheshire, which had been producing 60% of the UK’s carbon dioxide supplies.

CF Industries received financial aid later in September, covered by the taxpayer, to help with operational fees, followed by a three-month deal lasting from October 2021 to January 2022, which could ensure the company’s Teeside factory could continue running.

Chief Scientific Officer, Kate Halliwell, from the Food and Drink Federation said in a statement: “UK food and drink manufacturers welcome the deal that will ensure continuity of CO2 supply, keeping our shops, pubs and restaurants stocked with our favourite food and drink.”

Carbon dioxide is needed for many aspects of food and drink production such as the packaging of meats and cheeses and making of fizzy drinks.

The BEIS hopes that they will be able to work with the carbon dioxide industry to build more resilience to price hikes in the future.